The Best Tactics on Building a Board of Directors
Jeff Thompson has served on the board of directors for ten years at Edelbrock Corporation and was also a member of the executive, compensation and audit committees. He spoke of recruiting members for the NASDAQ exchange:
“We used a combination of well knowledgeable individuals in the industry so that they could give us feedback. We put a team of financial experts in that knew financials and knew the regulatory requirements. One, another one was a retired accountant that was with the business. And the last one was an attorney that could help give us guidance during the meetings, or anytime we publicized or put out anything making sure it was regulatory compliant.”
Ginger Silverman is a 25-year veteran specializing in marketing and regeneration. She has served on multiple advisory boards and boards of directors for private, public and non-profit companies.
“They’re different depending on the board and the industry, and the stage of the company also. I’ve participated in a lot of early stage startup boards, and in those situations there tends to be more of a focus on opportunities to open and support the growth of the company, the early stage growth, exposure of the company, and risk assessment along the way. As opposed to the more established companies that maybe have the round, well-rounded approach.”
Ginger also recommends that family businesses have outside directors:
“Over the past 10 years, I’ve worked with several companies that were long-standing family owned businesses that had changed leaders because of inheritance. The founder of the company had aged out and then the siblings or the children of the company had to come in to the leadership roles. Well that’s a perfect storm of problems for companies because they can be stuck in their old ways. They have a heritage which is wonderful, a legacy that’s gotten them to where they are. But if their competitive environment has changed, which I can’t think of an industry where it hasn’t, a lot of times that entrenchment can keep them from being objective about what they need to change. I’ve had the good fortune to work with several family-owned businesses that had the foresight to put together a board of people who were. “